Intercontinental Exchange Reports Strong Second Quarter 2020
Intercontinental Exchange (NYSE: ICE):
Intercontinental Exchange (NYSE: ICE), a leading operator of global exchanges and clearing houses and provider of data and listing services, today reported financial results for the second quarter of 2020. For the quarter ended June 30, 2020, consolidated net income attributable to ICE was $523 million on $1.4 billion of consolidated revenues, less transaction-based expenses. Second quarter GAAP diluted earnings per share (EPS) were $0.95. Adjusted net income attributable to ICE was $584 million in the second quarter and adjusted diluted EPS were $1.07. Please refer to the reconciliation of non-GAAP financial measures included in this press release for more information on our adjusted operating expenses, adjusted operating income, adjusted operating margin, adjusted net income, adjusted diluted EPS and free cash flow.
Scott A. Hill, ICE Chief Financial Officer, added: "In the first half, we built on our track record of consistent revenue growth, expense discipline and earnings per share growth. This performance enabled us to return over $1.4 billion of capital to our stockholders through dividends and our stock repurchase program. As we turn to the second half, we are well positioned to achieve our growth objectives and are investing to strengthen our foundation for continued growth in the future."
Second Quarter 2020 Business Highlights
Second quarter consolidated net revenues were $1.4 billion, up 8% year-over-year. Data and listings revenues in the second quarter were $685 million and trading and clearing net revenues were $710 million. Consolidated operating expenses were $651 million for the second quarter of 2020. On an adjusted basis, consolidated operating expenses were $575 million. Consolidated operating income for the second quarter was $744 million and the operating margin was 53%. On an adjusted basis, consolidated operating income for the second quarter was $820 million and the adjusted operating margin was 59%.
Data and Listings Segment Results
Second quarter data and listings revenues were $685 million, including data revenues of $574 million and listings revenues of $111 million. On a constant currency basis(1), segment revenues were up 3% with data revenues up 4% year-over-year. Data and listings operating expenses were $369 million and on an adjusted basis, were $319 million in the second quarter. Segment operating income for the second quarter was $316 million and the operating margin was 46%. On an adjusted basis, operating income was $366 million and the adjusted operating margin was 53%.
Trading and Clearing Segment Results
Second quarter trading and clearing net revenues were $710 million, up 12% from one year ago. Trading and clearing operating expenses were $282 million and adjusted operating expenses were $256 million in the second quarter. Segment operating income for the second quarter was $428 million and the operating margin was 60%. On an adjusted basis, operating income was $454 million and the adjusted operating margin was 64%.
The second quarter of 2020 included 63 trading days for commodities, other financials, interest rates and cash equities and equity options. The second quarter of 2019 included 63 trading days for commodities, other financials, interest rates and cash equities and equity options.
Earnings Conference Call Information
ICE will hold a conference call today, July 30, 2020, at 8:30 a.m. ET to review its second quarter 2020 financial results. A live audio webcast of the earnings call will be available on the company's website at www.theice.com in the investor relations section. Participants may also listen via telephone by dialing 888-317-6003 from the United States, 866-284-3684 from Canada or 412-317-6061 from outside of the United States and Canada. Telephone participants are required to provide the participant entry number 3663321 and are recommended to call 10 minutes prior to the start of the call. The call will be archived on the company's website for replay.
The conference call for the third quarter 2020 earnings has been scheduled for October 29, 2020 at 8:30 a.m. ET. Please refer to the Investor Relations website at www.ir.theice.com for additional information.
Historical futures, options and cash ADV, rate per contract, open interest data and CDS cleared information can be found at: http://ir.theice.com/investors-and-media/supplemental-volume-info/default.aspx
Non-GAAP Financial Measures and Reconciliation ?We use non-GAAP measures internally to evaluate our performance and in making financial and operational decisions. When viewed in conjunction with our GAAP results and the accompanying reconciliation, we believe that our presentation of these measures provides investors with greater transparency and a greater understanding of factors affecting our financial condition and results of operations than GAAP measures alone. In addition, we believe the presentation of these measures is useful to investors for period-to-period comparison of results because the items described below as adjustments to GAAP are not reflective of our core business performance. These financial measures are not in accordance with, or an alternative to, GAAP financial measures and may be different from non-GAAP measures used by other companies. We use these adjusted results because we believe they more clearly highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures, since these measures eliminate from our results specific financial items that have less bearing on our core operating performance. We strongly recommend that investors review the GAAP financial measures and additional non-GAAP information included in our Quarterly Report on Form 10-Q, including our consolidated financial statements and the notes thereto.
Adjusted operating expenses, adjusted operating income, adjusted operating margin, adjusted net income attributable to ICE common stockholders, adjusted diluted earnings per share and free cash flow for the periods presented below are calculated by adding or subtracting the adjustments described below, which are not reflective of our cash operations and core business performance, and their related income tax effect and other tax adjustments (in millions, except for per share amounts):
About Intercontinental Exchange
Intercontinental Exchange (NYSE: ICE) is a Fortune 500 company formed in the year 2000 to modernize markets. ICE serves customers by operating the exchanges, clearing houses and information services they rely upon to invest, trade and manage risk across global financial and commodity markets. A leader in market data, ICE Data Services serves the information and connectivity needs across virtually all asset classes. As the parent company of the New York Stock Exchange, the company is the premier venue for raising capital in the world, driving economic growth and transforming markets.
Trademarks of ICE and/or its affiliates include Intercontinental Exchange, ICE, ICE block design, NYSE and New York Stock Exchange. Information regarding additional trademarks and intellectual property rights of Intercontinental Exchange, Inc. and/or its affiliates is located at http://www.intercontinentalexchange.com/terms-of-use. Key Information Documents for certain products covered by the EU Packaged Retail and Insurance-based Investment Products Regulation can be accessed on the relevant exchange website under the heading "Key Information Documents (KIDS)."
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 - Statements in this press release regarding ICE's business that are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see ICE's Securities and Exchange Commission (SEC) filings, including, but not limited to, the risk factors in Intercontinental Exchange, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2019, as filed with the SEC on February 6, 2020. We caution you not to place undue reliance on these forward looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of an unanticipated event. New factors emerge from time to time, and it is not possible for management to predict all factors that may affect our business and prospects. Further, management cannot assess the impact of each factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
SOURCE: Intercontinental Exchange
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